Ericsson gives pink slips for Christmas

100 permanent and 200 contract workers shown door in ANZ

Ericsson's Australia and New Zealand operation has announced plans to cull 300 positions over the next six months as part of a global cost cutting programme.

Ericsson unveiled what it described as a global "cost adjustment" programme in February, outlining plans to cut Kr5.7 billion (NZ$1.29 billion) in costs.

For the Australia and New Zealand business, the cut in staff numbers also reflected "a number of projects that are nearing completion", the company said in a statement.

As well as 100 permanent positions, Ericsson said it would cut approximately 200 contract workers "in line with the completion of various project commitments".

Jeff Travers, Ericsson's New Zealand managing director, says consultations with local staff have just started and he cannot comment on numbers, except to say New Zealand is a very small part of the overall figure.

"We continue to have business with all the operators here," he says. We will continue to have full operations in New Zealand."

The cut in contractor numbers represents approximately half the total number of contract workers used by Ericsson in Australia and New Zealand. The company employs approximately 1,660 permanent employees across the two countries.

Ericsson did not state which projects were behind the planned redundancies.

But the company is not in a strong position to pick up work from the Australian federal government's National Broadband Network project, with Telstra declaring Alcatel-Lucent as the principal supplier for its bid and chief Telstra rival Optus a big customer of Nokia-Siemens Networks.

Normally a strong player in mobile networks, Ericsson's Australian business has been blamed for a delay in the expansion of Vodafone's 3G network, with reports suggesting Ericsson may be hit for claims of compensation.

In New Zealand, Telecom is also primarily using Alcatel Lucent for its network builds. — MIS Australia, additional reporting by Rob O'Neill

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